Template:Nhsc-v1-395 - Revision history

Reid Ginoza at 03:40, 5 June 2006

2006-06-05T03:40:52Z

Reid Ginoza at 03:00, 11 March 2006

2006-03-11T03:00:09Z

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discrepancies between the accounting
records maintained by the Hawaii
Department of Accounting and General
Services and the records of DHHL. In
addition, there were discrepancies
between DHHL's general ledger and
subsidiary ledgers.
The task of performing reconciliations
has been assigned to temporary
DHHL personnel, and there has been a
loss of continuity when positions are
vacated and refilled. At the time of
our audit, no reconciliations had been
attempted for about 8 months.
The audit function is an important
part of good financial management. It
helps to provide assurance to management
and interested outsiders concerning
the safeguarding of assets and the
reliability of financial data.
Accordingly, we believe that it is
important that (1) the recommendations
of the Legislative Auditor be
implemented, (2) the accounting system
be maintained on a current basis, and
(3) regular audits be performed.
Accuracy of Annual Report Data
DHHL needs to improve the
management information system so that
data included in DHHL's annual report
is accurate and supported. The Act
requires that DHHL submit an annual
report to the State Legislature. This
report is also widely distributed to
the Hawaiian community and provides
information by which the Hawaiian
community can evaluate the DHHL, and
so it is imperative that the data is
accurate.
Most of the quantitative data in
the report is extracted from various
records and monthly reports, but the
data has not been reconciled with the
source records for some time and there
are differences between the records
and the annual report. Also, we noted
that some of the records were not
accurate or complete.
For example, the DHHL listing of
homesteaders showed that there were
165 more homesteaders on June 30,
1981, than the 3,034 reported in the
fiscal year 1981 annual report, and
there were significant differences by
island and type of homesteader (see
Tables 73 and 74).
We also noted that two individuals
with pastoral or agricultural lots
were not included as such in the
homesteader list. Due to the amount
of effort it would entail, we did not
attempt to reconcile the list to the
annual report, or verify the list.
However, we noted one major cause of
the differences was that homesteaders
who had 35-acre farms and 5-acre
residential lots on Molokai were
counted twice. Also the problems with
the varying unreconciled sources of
acreage data previously discussed
under "land inventory" contribute to
the problems of the validity of the
data in the annual report.
Recommendations
We recommend that the DHHL improve
i t s financial management and reporting
system to correct the deficiencies we
noted in cash management, financial
statements, the accounting system, and
the annual report. Specifically, this
includes:
1. The timely investment of a ll
a v a i l a b l e monies not immediately
needed for current operations.
2. The proper and timely
maintenance and r e c o n c i l i a t i o n -
of accounting records.
3. The preparation of financial
statements and the independent
audit thereof.
395

@@ Line 6: / Line 6: @@
 between DHHL's general ledger and
 subsidiary ledgers.
 The task of performing reconciliations
 has been assigned to temporary
@@ Line 13: / Line 14: @@
 our audit, no reconciliations had been
 attempted for about 8 months.
 The audit function is an important
 part of good financial management. It
@@ Line 25: / Line 27: @@
 be maintained on a current basis, and
 (3) regular audits be performed.
 Accuracy of Annual Report Data
 DHHL needs to improve the
 management information system so that
@@ Line 38: / Line 41: @@
 so it is imperative that the data is
 accurate.
 Most of the quantitative data in
 the report is extracted from various
@@ Line 47: / Line 51: @@
 that some of the records were not
 accurate or complete.
 For example, the DHHL listing of
 homesteaders showed that there were
@@ Line 55: / Line 60: @@
 island and type of homesteader (see
 Tables 73 and 74).
 We also noted that two individuals
 with pastoral or agricultural lots
@@ Line 72: / Line 78: @@
 the problems of the validity of the
 data in the annual report.
 Recommendations
 We recommend that the DHHL improve
-i t s financial management and reporting
+its financial management and reporting
 system to correct the deficiencies we
 noted in cash management, financial
@@ Line 80: / Line 87: @@
 the annual report. Specifically, this
 includes:
-. The timely investment of a ll
-a v a i l a b l e monies not immediately
+: 1. The timely investment of all available monies not immediately needed for current operations.
 needed for current operations.
-. The proper and timely
+: 2. The proper and timely maintenance and reconciliation of accounting records.
-maintenance and r e c o n c i l i a t i o n -
-of accounting records.
+: 3. The preparation of financial statements and the independent audit thereof.
-. The preparation of financial
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